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BH GLOBAL MARINE LIMITED
ANNUAL REPORT 2012
from impairment of fixed assets, inventory and deposit for
purchase of land in Batam. Loss from operations amounted to
S$17.6 million. A further loss of S$5.0 million arising from the
depreciation of the Indonesian Rupiah against the Singapore
Dollar was recognized.
In view of the above and other management considerations,
including the losses incurred by PT BHE, the Board had
decided to discontinue the operations of the subsidiary in
Batam.
FINANCIAL POSITION
Total assets were S$170.3 million as of 31 December 2012,
down S$11.2 million or 6% y-o-y from the previous fiscal year-
end. Current assets were S$125.7 million, down S$11.4million
or 8% y-o-y. This was primarily due to decreases in inventory,
due from customers on construction contracts, receivables
and cash and bank balances. Inventories decreased by S$12.2
million from S$56.6 million in FY2011 to S$44.4 million in
FY2012 due to curtailment of operations as well as impairment
losses. The decrease in amount due from customers on
construction contracts is due to the completion of most of the
projects of the Engineering Services Division during FY2012
while other receivables were reduced due mainly to the
impairment of the deposit for purchase of land in Batam.
Total liabilities stood at S$86.9 million on 31 December
2012, representing an increase of 39% y-o-y, as the Group
incurred additional S$16.7 million of bank borrowings to
finance the construction of the galvanized steel wire factory
of the Manufacturing Division in Oman. As such, the Group
concluded FY2012 with a net gearing ratio of 36.7%.
Net assets amounted to S$83.3 million on 31 December 2012,
down S$35.7 million from the end of the previous fiscal year.
Net asset value per ordinary share shrunk accordingly to 17
Singapore cents per share, from 24 Singapore cents per share
a year ago.
The cash and cash equivalents position remained strong at
S$14.4 million as at 31 December 2012 (31 December 2011:
S$17.0 million).
CONCLUSION
The Group is taking active steps to resolve all the outstanding
matters in its Batam subsidiary, including the divestment of
its remaining assets and closure of its operations. Moving
forward, we will enforce tighter monitoring and controls in
project execution at the subsidiary level.
The marine industry continues to remain challenging whereas
prospect for the oil & gas industry is expected to remain
buoyant. We will continue to focus on our core competencies
in our Supply Chain Management Division. The Group will also
continue to work towards expanding its product portfolio and
geographical footprints either organically or through strategic
partnerships in Middle East and Asia.
We believe the worst is over, and we are looking ahead for a
better FY2013.
Vincent Lim Hui Eng
Chief Executive Officer
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